Caddies Sue PGA for $50 Million in Lost Advertising Revenue

With the PGA tour raking in big bucks from advertising, part of which comes from tour caddies wearing corporate logos on their bibs, 80 professional caddies joined in a $50 million lawsuit charging that they deserve some of the spoils for their role as unpaid roaming billboards.

Tuesday Mike Hicks, who carried both Payne Stewart’s and Greg Norman’s bag in his day, spearheaded the class-action lawsuit on behalf of all PGA tour caddies in the United States in U.S. District Court for the Northern District of California. The Hicks v. PGA Tour case effectively includes 1,000 caddies and if successful could provide millions of dollars in damages.

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It so happens that the Northern District court is the same court that Ed O’Bannon successfully sued the NCAA for exploitation of college athletes for not sharing in sponsor related revenues.

Significantly, caddies often become invisible for fans, who understandably pay more attention to the tour stars. But, caddies are visible on TV, making them valuable to the advertisers, an important point in Hicks v. PGA Tour.

Caddies are expected to wear bibs, which bear logos of companies paying the PGA Tour but not paying the caddies. These bibs are seen during television broadcasts of tournaments and are captured in photographs used in magazines and on websites. These bibs lie at the heart of Hicks v. PGA Tour. The legal question is whether caddies should be paid for wearing them.

Specifically, the lawsuit contends that the “the bib” is key to marketing sponsors between commercials during telecasts. Lead attorney for the caddies Eugene Egdorf asserted that “the PGA Tour and its sponsors have received literally hundreds of millions of dollars in value from endorsements from the bibs the caddies are forced to wear without any compensation whatsoever.”

On top of that, caddies argue that wearing the PGA-designated bibs is an unlawful restraint of trade and thus a violation of the Sherman Antitrust Act. Having to wear the PGA bib prevents caddies from negotiating their own bib deals, which could result in additional revenue for the bag carriers.

According to Golf.com, it is likely that the PGA will counter their argument saying that imposing bibs on caddies may interfere with caddies ability to pedal their own sponsors, but overall it makes the tournaments more profitable and thus enhances tournament product.

If the caddies are able to advance the trial beyond a “dismissal,” most likely the PGA tour will settle. The end result should fatten the caddies’s wallets and probably lead to changes in “The bib” policies moving forward.